Company may deem and treat the registered Holder of this Warrant as the absolute owner hereoffor the purpose of any exercise hereof or any distribution to the Holder, and for all otherpurposes, absent actual notice to the contrary.     3. List of Transfers; Restrictions on Transfer.     (a) This Warrant may be offered for sale, sold, transferred or assigned without the consent ofthe Company, except as may otherwise be required by Section 2(g) of the Purchase Agreement.     (b) The Company shall register any such transfer of all or any portion of this Warrant in theWarrant Register, upon surrender of this Warrant, with the Form of Assignment attached hereto dulycompleted and signed, to the Company at its address specified herein. Upon any such registrationor transfer, a new Warrant to purchase Common Stock, in substantially the form of this Warrant (inaccordance with Section 3(e)), evidencing the portion of this Warrant so transferred shall beissued to the transferee and a new Warrant evidencing the remaining portion of this Warrant not sotransferred, if any, shall be issued to the transferring Holder. The acceptance of the new Warrantby the transferee thereof shall be deemed the acceptance by such transferee of all of the rightsand obligations in respect of the new Warrant that the Holder has in respect of this Warrant.     (c) This Warrant is exchangeable, upon the surrender hereof by the Holder at the principaloffice of the Company, for a new Warrant or Warrants (in accordance with Section 3(e)) representingin the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant,and each such new Warrant will represent the right to purchase such portion of such Warrant Sharesas is designated by the Holder at the time of such surrender; provided, however, no warrants forfractional shares of Common Stock shall be given.     (d) If, at the time of the surrender of this Warrant in connection with any transfer of thisWarrant, transfer of this Warrant shall not be registered pursuant to an effective registrationstatement under the Securities Act and under applicable state securities or blue sky laws, theCompany may require, as a condition of allowing such transfer (i) that the Holder or transferee ofthis Warrant, as the case may be, furnish to the Company a written opinion of counsel (whichopinion shall be in form, substance and scope customary for opinions of counsel in comparabletransactions) to the effect that such transfer may be made without registration under theSecurities Act and under applicable state securities or blue sky laws, (ii) that the holder ortransferee execute and deliver to the Company an investment letter in form and substance acceptableto the Company and (iii) that the transferee be an “accredited investor” as defined in Rule 501(a)promulgated under the Securities Act.     (e) Whenever the Company is required to issue a new Warrant pursuant to the terms of thisWarrant, such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, asindicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlyingthis Warrant (or in the case of a new Warrant being issued pursuant to this Section 3 or Section 7,the Warrant Shares designated by the Holder which, when added to the number of shares of CommonStock underlying the other new Warrants issued in connection with such issuance, does not exceedthe number of Warrant Shares then underlying this Warrant), (iii) shall
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have an issuance date, as indicated on the face of such new Warrant which is the same as theOriginal Issue Date, and (iv) shall have the same rights and conditions as this Warrant.     4. Exercise and Duration of Warrants.     (a) All or any part of this Warrant shall be exercisable by the registered Holder in anymanner permitted by Section 4 of this Warrant at any time and from time to time on or after theOriginal Issue Date and through and including the Expiration Date. At 5:00 p.m., New York Citytime, on the Expiration Date, the portion of this Warrant not exercised prior thereto shall be andbecome void and of no value and this Warrant shall be terminated and no longer outstanding. Inaddition, if cashless exercise would be permitted under Section 4(c) of this Warrant, then all orpart of this Warrant may be exercised by the registered Holder utilizing such cashless exerciseprovisions at any time, or from time to time, on or after the Original Issue Date and through andincluding the Expiration Date.     (b) The Holder may exercise this Warrant by delivering to the Company an exercise notice, inthe form attached hereto (the “**Exercise Notice**”), completed and duly signed. If suchHolder is not utilizing the cashless exercise provisions set forth in this Warrant, within one (1)Trading Day following an exercise of this Warrant as aforesaid, the Holder shall deliver payment tothe Company of an amount equal to the Exercise Price for the number of Warrant Shares as to whichthis Warrant is being exercised (the “**Aggregate Exercise Price**”). The date the ExerciseNotice is delivered to the Company (as determined in accordance with the notice provisions hereof)is an “**Exercise Date**.” The Holder shall not be required to deliver the original Warrant inorder to effect an exercise hereunder. Execution and delivery of the Exercise Notice shall havethe same effect as cancellation of the original Warrant and issuance of a New Warrant evidencingthe right to purchase the remaining number of Warrant Shares. Additionally, at the request of theHolder, if this Warrant shall have been exercised in part and the Holder shall have surrenderedthis Warrant certificate, the Company shall, at the time of delivery of the certificate orcertificates representing Warrant Shares, deliver to Holder a new Warrant evidencing the rights ofHolder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrantshall in all other respects be identical with this Warrant.     (c) Notwithstanding anything contained herein to the contrary, if at the time of exercisehereof, a Registration Statement (as defined in the Registration Rights Agreement (as defined inthe Purchase Agreement)) is not effective (or the prospectus contained therein is not available foruse) for the resale by the Holder of all of the Warrant Shares, then the Holder may, in its solediscretion, exercise this Warrant in whole or in part and, in lieu of making the cash paymentotherwise contemplated to be made to the Company upon such exercise in payment of the AggregateExercise Price, elect instead to receive upon such exercise the “Net Number” of shares of CommonStock determined according to the following formula (a “**Cashless Exercise**”):     Net Number = (A x B) - (A x C)         B  For purposes of the foregoing formula:
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   A= the total number of shares with respect to which this Warrantis then being exercised.    B= as applicable: (i) the Closing Sale Price of the Common Stockon the Trading Day immediately preceding the date of the applicable ExerciseNotice if such Exercise Notice is (1) both executed and delivered pursuant toSection 4 hereof on a day that is not a Trading Day or (2) both executed anddelivered pursuant to Section 4 hereof on a Trading Day prior to the opening of“regular trading hours” (as defined in Rule 600(b)(64) of Regulation NMSpromulgated under the federal securities laws) on such Trading Day, (ii) theBid Price of the Common Stock as of the time of the Holder’s execution of theapplicable Exercise Notice if such Exercise Notice is executed during “regulartrading hours” on a Trading Day and is delivered within two (2) hoursthereafter pursuant to Section 4 hereof and (iii) the Closing Sale Price of theCommon Stock on the date of the applicable Exercise Notice if the date of suchExercise Notice is a Trading Day and such Exercise Notice is both executed anddelivered pursuant to Section 4 hereof after the close of “regular tradinghours” on such Trading Day.    C= the Exercise Price then in effect for the applicable WarrantShares at the time of such exercise.     (d) In the case of a dispute as to the determination of the Exercise Price or the arithmeticcalculation of the number of Warrant Shares to be issued pursuant to the terms hereof, the Companyshall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolvesuch dispute in accordance with Section 15.     5. Delivery of Warrant Shares.     (a) On or before the first (1st) Trading Day following the date on which theCompany has received an Exercise Notice, the Company shall transmit by facsimile or electronic mailan acknowledgment of confirmation of receipt of such Exercise Notice, to the Holder and theCompany’s transfer agent (the “**Transfer Agent**”). On or before the third (3rd)Trading Day following the date on which the Company has received such Exercise Notice, the Companyshall (X) provided that the Transfer Agent is participating in The Depository Trust Company(“**DTC**”) Fast Automated Securities Transfer Program and the Warrant Shares can be issuedwithout restrictive legends, upon the request of the Holder, credit such aggregate number of sharesof Common Stock to which the Holder is entitled pursuant to such exercise to the Holder’s or itsdesignee’s balance account with DTC through its Deposit/Withdrawal at Custodian system, or (Y) ifthe Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program orthe Warrant Shares cannot be issued without restrictive legends, issue and deliver to the Holderor, at the Holder’s instruction pursuant to the Exercise Notice, the Holder’s agent or designee, ineach case, sent by reputable overnight courier to the address as specified in the applicableExercise Notice, a certificate, registered in the Company’s share register in the name of theHolder or its designee (as indicated in the applicable Exercise Notice), for the number of sharesof Common Stock to which the Holder is entitled pursuant to such exercise. Upon
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delivery of an Exercise Notice, the Holder shall be deemed for all corporate purposes to havebecome the holder of record of the Warrant Shares with respect to which this Warrant has beenexercised, irrespective of the date such Warrant Shares are credited to the Holder’s DTC account orthe date of delivery of the certificates evidencing such Warrant Shares (as the case may be). TheHolder, or any Person permissibly so designated by the Holder to receive Warrant Shares, shall bedeemed to have become the holder of record of such Warrant Shares as of the Exercise Date.Notwithstanding the foregoing, except in the case where an exercise of this Warrant is validly madepursuant to a cashless exercise, the Company’s failure to deliver Warrant Shares to the Holder onor prior to the later of (x) the close of the third Trading Day after delivery of an ExerciseNotice and (y) the Trading Day in which the Company’s receives the Aggregate Exercise Price (suchlater date, the “**Share Delivery Deadline**”) shall not be deemed to be a breach of thisWarrant.     (b) If by the Share Delivery Deadline, the Company fails to deliver to the Holder acertificate representing the required number of Warrant Shares in the manner required pursuant toSection 5(a), and if after such third Trading Day and prior to the receipt of such Warrant Shares,the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliverin satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipatedreceiving upon such exercise (a “**Buy-In**”), then the Company shall, within three TradingDays after the Holder’s request and in the Holder’s sole discretion, either (i) pay in cash to theHolder an amount equal to the Holder’s total purchase price (including brokerage commissions, ifany) for the shares of Common Stock so purchased (the “**Buy-In Price**”), at which point theCompany’s obligation to deliver such certificate (and to issue such Warrant Shares) shall terminateor (ii) promptly honor its obligation to deliver to the Holder a certificate or certificatesrepresenting such shares of Common Stock or credit the Holder’s balance account with DTC for thenumber of shares of Common Stock to which the Holder is entitled upon the Holder’s exercisehereunder (as the case may be) and pay cash to the Holder in an amount equal to the excess (if any)of the Buy-In Price over the product of (A) such number of shares of Common Stock times (B) theClosing Sale Price of the Common Stock on the Trading Day immediately preceding the date of theapplicable Exercise Notice.     (c) To the extent permitted by law, the Company’s obligations to issue and deliver WarrantShares in accordance with the terms hereof are absolute and unconditional, irrespective of anyaction or inaction by the Holder to enforce the same, any waiver or consent with respect to anyprovision hereof, the recovery of any judgment against any Person or any action to enforce thesame, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or allegedbreach by the Holder or any other Person of any obligation to the Company or any violation oralleged violation of law by the Holder or any other Person, and irrespective of any othercircumstance that might otherwise limit such obligation of the Company to the Holder in connectionwith the issuance of Warrant Shares. Nothing herein shall limit a Holder’s right to pursue anyother remedies available to it hereunder, at law or in equity including, without limitation, adecree of specific performance and/or injunctive relief with respect to the Company’s failure totimely deliver certificates representing shares of Common Stock upon exercise of the Warrant asrequired pursuant to the terms hereof.     6. Charges, Taxes and Expenses. Issuance and delivery of certificates for shares ofCommon Stock upon exercise of this Warrant shall be made without charge to the Holder for any
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issue or transfer tax, withholding tax, transfer agent fee or other incidental tax or expensein respect of the issuance of such certificates, all of which taxes and expenses shall be paid bythe Company; *provided, however*, that the Company shall not be required to pay any tax that may bepayable in respect of any transfer involved in the registration of any certificates for WarrantShares or Warrants in a name other than that of the Holder. The Holder shall be responsible forall other tax liability that may arise as a result of holding or transferring this Warrant orreceiving Warrant Shares upon exercise hereof.     7. Replacement of Warrant. If this Warrant is mutilated, lost, stolen or destroyed,the Company shall issue or cause to be issued in exchange and substitution for and uponcancellation hereof, or in lieu of and substitution for this Warrant, a new Warrant (in accordancewith Section 3(e)), but only upon receipt of evidence reasonably satisfactory to the Company ofsuch loss, theft or destruction and customary and reasonable indemnity (which shall not include asurety bond), if requested. Applicants for a new Warrant under such circumstances shall alsocomply with such other reasonable regulations and procedures and pay such other reasonablethird-party costs as the Company may prescribe. If a new Warrant is requested as a result of amutilation of this Warrant, then the Holder shall deliver such mutilated Warrant to the Company asa condition precedent to the Company’s obligation to issue the new Warrant.     8. Reservation of Warrant Shares. The Company covenants that it will at all timesreserve and keep available out of the aggregate of its authorized but unissued and otherwiseunreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares uponexercise of this Warrant as herein provided, the number of Warrant Shares that are then issuableand deliverable upon the exercise of this entire Warrant, free from preemptive rights or any othercontingent purchase rights of persons other than the Holder (taking into account the adjustmentsand restrictions of Section 9). The Company covenants that all Warrant Shares so issuable anddeliverable shall, upon issuance and the payment of the applicable Exercise Price in accordancewith the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable. If,notwithstanding the foregoing, and not in limitation thereof, at any time while any of the Warrantsremain outstanding the Company does not have a sufficient number of authorized and unreservedshares of Common Stock to satisfy its obligation to reserve for issuance upon exercise of theWarrants at least a number of shares of Common Stock equal to the number of shares of Common Stockas shall from time to time be necessary to effect the exercise of all of the Warrants thenoutstanding (the “**Required Reserve Amount**”, and such reservation failure, an“**Authorized Share Failure**”), then the Company shall promptly take all action necessary toincrease the Company’s authorized shares of Common Stock to an amount sufficient to allow theCompany to reserve the Required Reserve Amount for all the Warrants then outstanding. Withoutlimiting the generality of the foregoing sentence, as soon as practicable after the date of theoccurrence of an Authorized Share Failure, but in no event later than sixty (60) days after theoccurrence of such Authorized Share Failure, the Company shall hold a meeting of its stockholdersfor the approval of an increase in the number of authorized shares of Common Stock. In connectionwith such meeting, the Company shall provide each stockholder with a proxy statement and shall useits best efforts to solicit its stockholders’ approval of such increase in authorized shares ofCommon Stock and to cause its board of directors to recommend to the stockholders that they approvesuch proposal.     9. Certain Adjustments. The Exercise Price and number of Warrant Shares issuable
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upon exercise of this Warrant are subject to adjustment from time to time as set forth in thisSection 9.     (a) Stock Dividends and Splits. If the Company, at any time while this Warrant isoutstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on anyclass of capital stock that is payable in shares of Common Stock, (ii) subdivides (by any stocksplit, stock dividend, recapitalization or otherwise) outstanding shares of Common Stock into alarger number of shares, or (iii) combines (by combination, reverse stock split or otherwise)outstanding shares of Common Stock into a smaller number of shares, then in each such case theExercise Price shall be multiplied by a fraction of which the numerator shall be the number ofshares of Common Stock outstanding immediately before such event and of which the denominator shallbe the number of shares of Common Stock outstanding immediately after such event. Any adjustmentmade pursuant to clause (i) of this paragraph shall become effective immediately after the recorddate for the determination of stockholders entitled to receive such dividend or distribution, andany adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effectiveimmediately after the effective date of such subdivision or combination. If any event requiring anadjustment under this paragraph occurs during the period that an Exercise Price is calculatedhereunder, then the calculation of such Exercise Price shall be adjusted appropriately to reflectsuch event.     (b) Pro Rata Distributions. If the Company, at any time while this Warrant isoutstanding, distributes to all holders of Common Stock for no consideration (i) evidences of itsindebtedness, (ii) any security (other than a distribution of Common Stock covered by Section9(a)), (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset(in each case, “**Distributed Property**”), then, upon any exercise of this Warrant that occursafter the record date fixed for determination of stockholders entitled to receive suchdistribution, the Holder shall be entitled to receive, in addition to the Warrant Shares otherwiseissuable upon such exercise (if applicable) (without regard to any limitations on exercise hereof),the Distributed Property that such Holder would have been entitled to receive in respect of suchnumber of Warrant Shares had the Holder been the record holder of such Warrant Shares immediatelyprior to such record date.     (c) Fundamental Transactions. If, at any time while this Warrant is outstanding (i)the Company effects any merger or consolidation of the Company with or into another Person, inwhich the shareholders of the Company as of immediately prior to the transaction own less than amajority of the outstanding stock of the surviving entity, (ii) the Company effects any sale of allor substantially all of its assets in one or a series of related transactions, (iii) any tenderoffer or exchange offer (whether by the Company or another Person) is completed pursuant to whichholders of Common Stock are permitted to tender or exchange their shares for other securities, cashor property, or (iv) the Company effects any reclassification of the Common Stock or any compulsoryshare exchange pursuant to which the Common Stock is effectively converted into or exchanged forother securities, cash or property (each, a “**Fundamental Transaction**”), then the Holdershall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kindof securities, cash or property as it would have been entitled to receive upon the occurrence ofsuch Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, theholder of the number of Warrant Shares then issuable upon exercise in full of this Warrant (the“**Alternate Consideration**”). The Company shall not effect
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any such Fundamental Transaction unless prior to or simultaneously with the consummationthereof, any successor to the Company, surviving entity or the corporation purchasing or otherwiseacquiring such assets or other appropriate corporation or entity shall assume the obligation todeliver to the Holder, such Alternate Consideration as, in accordance with the foregoingprovisions, the Holder may be entitled to purchase, and the other obligations under this Warrant.The provisions of this paragraph (c) shall similarly apply to subsequent transactions analogous toa Fundamental Transaction.     (d) Number of Warrant Shares. Simultaneously with any adjustment to the ExercisePrice pursuant to paragraphs (a) and (b) of this Section 9, the number of Warrant Shares that maybe purchased upon exercise of this Warrant shall be increased or decreased proportionately, so thatafter such adjustment the aggregate Exercise Price payable hereunder for the adjusted number ofWarrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior tosuch adjustment.     (e) Calculations. All calculations under this Section 9 shall be made to the nearestcent or the nearest 1/100th of a share, as applicable. The number of shares of Common Stockoutstanding at any given time shall not include shares owned or held by or for the account of theCompany, and the disposition of any such shares shall be considered an issue or sale of CommonStock.     (f) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to thisSection 9, the Company at its expense will, at the written request of the Holder, promptly computesuch adjustment in accordance with the terms of this Warrant and prepare a certificate settingforth such adjustment, including a statement of the adjusted Exercise Price and adjusted number ortype of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable),describing the transactions giving rise to such adjustments and showing in detail the facts uponwhich such adjustment is based. Upon written request, the Company will promptly deliver a copy ofeach such certificate to the Holder and to the Company’s Transfer Agent.     (g) Notice of Events. The Company will give written notice to the Holder at least two(2) days prior to the date on which the Company closes its books or takes a record (A) with respectto any dividend or distribution upon the shares of Common Stock, or (B) for determining rights tovote with respect to any Fundamental Transaction, dissolution or liquidation. Notwithstanding theforegoing, the failure deliver such notice or any defect therein shall not affect the validity ofthe corporate action required to be described in such notice. To the extent that any noticeprovided hereunder constitutes, or contains, material, non-public information regarding the Company(including its subsidiaries), the Company shall simultaneously file such notice with the SEC (asdefined in the Purchase Agreement) pursuant to a Current Report on Form 8-K. It is expresslyunderstood and agreed that the time of execution specified by the Holder in each Exercise Noticeshall be definitive and may not be disputed or challenged by the Company.     10. Payment of Exercise Price. The Holder shall pay the Exercise Price by deliveringimmediately available funds to the Company unless the Holder has specified a “Cashless Exercise” inthe applicable Exercise Notice.
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     11. No Fractional Shares. No fractional Warrant Shares will be issued in connectionwith any exercise of this Warrant. In lieu of any fractional shares that would otherwise beissuable, the Company shall pay cash equal to the product of such fraction multiplied by theClosing Bid Price of one Warrant Share on the applicable Exercise Date.     12. Notices. Any and all notices or other communications or deliveries hereunder(including, without limitation, any Exercise Notice) shall be in writing and shall be deemed givenand effective on the earliest of (i) upon confirmation of receipt, if such notice or communicationis delivered via facsimile or electronic mail at the facsimile number or e-mail address specifiedin this Section at or prior to 5:00 p.m. (New York City time) on a Trading Day (providedconfirmation of transmission is mechanically or electronically generated and kept on file by thesending party), (ii) the next Trading Day after the date of confirmation of receipt, if such noticeor communication is delivered via facsimile or electronic mail at the facsimile number or e-mailaddress specified in this Section on a day that is not a Trading Day or later than 5:00 p.m. (NewYork City time) on any Trading Day (provided confirmation of transmission is mechanically orelectronically generated and kept on file by the sending party), (iii) the Trading Day followingthe date of mailing, if sent by nationally recognized overnight courier service, or (iv) uponactual receipt by the party to whom such notice is required to be given. The addresses for suchnotices or communications shall be: if to the Company, to Emisphere Technologies, Inc., 240 CedarKnolls Road, Suite 200, Cedar Knolls, New Jersey 07927. Attention: Chief Financial Officer,Facsimile No.: (973) 532-8121, e-mail address: mgarone@emisphere.com (or such other address as theCompany shall indicate in writing in accordance with this Section) or (ii) if to the Holder, to theaddress, facsimile number or e-mail address appearing on the Warrant Register (or such otheraddress as the Company shall indicate in writing in accordance with this Section).     13. Warrant Agent. The Company shall serve as warrant agent under this Warrant. Upon30 days’ notice to the Holder, the Company may appoint a new warrant agent. Any corporation intowhich the Company or any new warrant agent may be merged or any corporation resulting from anyconsolidation to which the Company or any new warrant agent shall be a party or any corporation towhich the Company or any new warrant agent transfers substantially all of its corporate trust orshareholders services business shall be a successor warrant agent under this Warrant without anyfurther act. Any such successor warrant agent shall promptly cause notice of its succession aswarrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’slast address as shown on the Warrant Register.     14. Noncircumvention. The Company hereby covenants and agrees that the Company willnot, by amendment of its Articles of Incorporation, as amended, its Bylaws as amended or throughany reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution,issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observanceor performance of any of the terms of this Warrant, and will at all times in good faith carry outall the provisions of this Warrant and take all action as may be required to protect the rights ofthe Holder. Without limiting the generality of the foregoing, the Company (i) shall not increasethe par value of any shares of Common Stock receivable upon the exercise of this Warrant above theExercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriatein order that the Company may validly and legally issue fully paid and nonassessable shares ofCommon Stock upon the exercise of this Warrant, and (iii) shall, so long
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as any of the Warrants are outstanding, take all action necessary to reserve and keepavailable out of its authorized and unissued shares of Common Stock, solely for the purpose ofeffecting the exercise of the Warrants, the maximum number of shares of Common Stock as shall fromtime to time be necessary to effect the exercise of the Warrants then outstanding (without regardto any limitations on exercise).     15. Dispute Resolution. In the case of a dispute as to the determination of theExercise Price, the Closing Bid Price, the Closing Sale Price, the Bid Price or fair market valueor the arithmetic calculation of the number of Warrant Shares (as the case may be), the Company orthe Holder (as the case may be) shall submit the disputed determinations or arithmetic calculations(as the case may be) via facsimile (i) within two (2) Business Days after receipt of the applicablenotice giving rise to such dispute to the Company or the Holder (as the case may be) or (ii) if nonotice gave rise to such dispute, at any time after the Holder learned of the circumstances givingrise to such dispute. If the Holder and the Company are unable to agree upon such determination orcalculation (as the case may be) of the Exercise Price, the Closing Bid Price, the Closing SalePrice, the Bid Price or fair market value or the number of Warrant Shares (as the case may be)within three (3) Business Days of such disputed determination or arithmetic calculation beingsubmitted to the Company or the Holder (as the case may be), then the Company shall, within two (2)Business Days submit via facsimile (a) the disputed determination of the Exercise Price, theClosing Bid Price, the Closing Sale Price, the Bid Price or fair market value (as the case may be)to an independent, reputable investment bank selected by the Company and approved by the Holder or(b) the disputed arithmetic calculation of the number of Warrant Shares to the Company’sindependent, outside accountant. The Company shall cause the investment bank or the accountant (asthe case may be) to perform the determinations or calculations (as the case may be) and notify theCompany and the Holder of the results no later than ten (10) Business Days from the time itreceives such disputed determinations or calculations (as the case may be). Such investment bank’sor accountant’s determination or calculation (as the case may be) shall be binding upon all partiesabsent demonstrable error. If a disputed determination or arithmetic calculation is submitted tothe investment bank or the accountant (as the case may be) pursuant to this Section 16, then theprevailing party in such determination or calculation shall be reimbursed by the other party forits costs and expenses (including any and all fees and expenses charged by the investment back oraccountant) incurred in connection with the determination or calculation (as the case may be).     16. Remedies, Characterization, Other Obligations, Breaches and Injunctive Relief. Theremedies provided in this Warrant shall be cumulative and in addition to all other remediesavailable under this Warrant and the other Transaction Documents, at law or in equity (including adecree of specific performance and/or other injunctive relief), and nothing herein shall limit theright of the Holder to pursue actual damages for any failure by the Company to comply with theterms of this Warrant. The Company covenants to the Holder that there shall be no characterizationconcerning this instrument other than as expressly provided herein. Amounts set forth or providedfor herein with respect to payments, exercises and the like (and the computation thereof) shall bethe amounts to be received by the Holder and shall not, except as expressly provided herein, besubject to any other obligation of the Company (or the performance thereof). The Companyacknowledges that a breach by it of its obligations hereunder will cause irreparable harm to theHolder and that the remedy at law for any such breach may be inadequate. The Company thereforeagrees that, in the event of any such breach
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or threatened breach, the holder of this Warrant shall be entitled, in addition to all otheravailable remedies, to an injunction restraining any breach, without the necessity of showingeconomic loss and without any bond or other security being required. The Company shall provide allinformation and documentation to the Holder that is requested by the Holder that is reasonablynecessary to enable the Holder to confirm the Company’s compliance with the terms and conditions ofthis Warrant. The issuance of shares and certificates for shares as contemplated hereby upon theexercise of this Warrant shall be made without charge to the Holder or such shares for any issuancetax or other costs in respect thereof, provided that the Company shall not be required to pay anytax which may be payable in respect of any transfer involved in the issuance and delivery of anycertificate in a name other than the Holder or its agent on its behalf.     17. Miscellaneous.     (a) This Warrant shall be binding on and inure to the benefit of the parties hereto and theirrespective successors and assigns. Subject to the preceding sentence, nothing in this Warrantshall be construed to give to any Person other than the Company and the Holder any legal orequitable right, remedy or cause of action under this Warrant. This Warrant may be amended only inwriting signed by the Company and the Holder, or their successors and assigns. No waiver shall beeffective unless it is in writing and signed by an authorized representative of the waiving party.     (b) This Warrant shall be governed by and construed and enforced in accordance with, and allquestions concerning the construction, validity, interpretation and performance of this Warrantshall be governed by, the internal laws of the State of New York, without giving effect to anychoice of law or conflict of law provision or rule (whether of the State of New York or any otherjurisdictions) that would cause the application of the laws of any jurisdictions other than theState of New York. The parties hereby irrevocably submits to the exclusive jurisdiction of thestate and federal courts sitting in The City of New York, Borough of Manhattan, for theadjudication of any dispute hereunder or in connection herewith or with any transactioncontemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert inany suit, action or proceeding, any claim that it is not personally subject to the jurisdiction ofany such court, that such suit, action or proceeding is brought in an inconvenient forum or thatthe venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemedto limit in any way any right to serve process in any manner permitted by law. **THE PARTIES HEREBYIRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THEADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANYTRANSACTION CONTEMPLATED HEREBY.**     (c) If any provision of this Warrant is prohibited by law or otherwise determined to beinvalid or unenforceable by a court of competent jurisdiction, the provision that would otherwisebe prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extentthat it would be valid and enforceable, and the invalidity or unenforceability of such provisionshall not affect the validity of the remaining provisions of this Warrant so long as this Warrantas so modified continues to express, without material change, the original intentions of theparties as to the subject matter hereof and the prohibited nature, invalidity or unenforceabilityof the provision(s) in question does not substantially impair the respective
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expectations or reciprocal obligations of the parties or the practical realization of thebenefits that would otherwise be conferred upon the parties. The parties will endeavor in goodfaith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a validprovision(s), the effect of which comes as close as possible to that of the prohibited, invalid orunenforceable provision(s).     (d) The headings herein are for convenience only, do not constitute a part of this Warrant andshall not be deemed to limit or affect any of the provisions hereof.     (e) In case any one or more of the provisions of this Warrant shall be invalid orunenforceable in any respect, the validity and enforceability of the remaining terms and provisionsof this Warrant shall not in any way be affected or impaired thereby and the parties will attemptin good faith to agree upon a valid and enforceable provision which shall be a commerciallyreasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provisionin this Warrant.     (f) Prior to exercise of this Warrant, the Holder hereof shall not, by reason of by being aHolder, be entitled to any rights of a stockholder with respect to the Warrant Shares.     18. Certain Definitions. For purposes of this Warrant, the following terms shall havethe following meanings:     (a) “**Bid Price**” means, for any security as of the particular time of determination, the bidprice for such security on the Principal Market as reported by Bloomberg as of such time ofdetermination, or, if the Principal Market is not the principal securities exchange or tradingmarket for such security, the bid price of such security on the principal securities exchange ortrading market where such security is listed or traded as reported by Bloomberg as of such time ofdetermination, or if the foregoing does not apply, the bid price of such security in theover-the-counter market on the electronic bulletin board for such security as reported by Bloombergas of such time of determination, or, if no bid price is reported for such security by Bloomberg asof such time of determination, the average of the bid prices of any market makers for such securityas reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.)as of such time of determination. If the Bid Price cannot be calculated for a security as of theparticular time of determination on any of the foregoing bases, the Bid Price of such security asof such time of determination shall be the fair market value as mutually determined by the Companyand the Holder. If the Company and the Holder are unable to agree upon the fair market value ofsuch security, then such dispute shall be resolved in accordance with the procedures in Section 15.All such determinations shall be appropriately adjusted for any stock dividend, stock split, stockcombination or other similar transaction during such period.     (b) “**Bloomberg**” means Bloomberg, L.P.     (c) “**Business Day**” means any day other than Saturday, Sunday or other day on which commercialbanks in The City of New York are authorized or required by law to remain closed.     (d) “**Closing Bid Price**” and “**Closing Sale Price**” means, for any security as of any date, thelast closing bid price and last closing trade price, respectively, for such security on the
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Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate onan extended hours basis and does not designate the closing bid price or the closing trade price (asthe case may be) then the last bid price or last trade price, respectively, of such security priorto 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not theprincipal securities exchange or trading market for such security, the last closing bid price orlast trade price, respectively, of such security on the principal securities exchange or tradingmarket where such security is listed or traded as reported by Bloomberg, or if the foregoing do notapply, the last closing bid price or last trade price, respectively, of such security in theover-the-counter market on the electronic bulletin board for such security as reported byBloomberg, or, if no closing bid price or last trade price, respectively, is reported for suchsecurity by Bloomberg, the average of the bid prices, or the ask prices, respectively, of anymarket makers for such security as reported in the “pink sheets” by Pink Sheets LLC (formerly theNational Quotation Bureau, Inc.). If the Closing Bid Price or the Closing Sale Price cannot becalculated for a security on a particular date on any of the foregoing bases, the Closing Bid Priceor the Closing Sale Price (as the case may be) of such security on such date shall be the fairmarket value as mutually determined by the Company and the Holder. If the Company and the Holderare unable to agree upon the fair market value of such security, then such dispute shall beresolved in accordance with the procedures in Section 15. All such determinations shall beappropriately adjusted for any stock dividend, stock split, stock combination or other similartransaction during such period.     (e) “**Common Stock**” means (i) the Company’s shares of common stock, $0.01 par value per share,and (ii) any capital stock into which such common stock shall have been changed or any sharecapital resulting from a reclassification of such common stock.     (f) “**Eligible Market**” means The New York Stock Exchange, the NYSE Amex, the Nasdaq GlobalSelect Market, the Nasdaq Global Market, the Nasdaq Capital Market, the Principal Market.     (g) “**Expiration Date**” means the date that is the fifth (5th) anniversary of theOriginal Issue Date or, if such date falls on a day other than a Business Day or on which tradingdoes not take place on the Principal Market (a “**Holiday**”), the next date that is not a Holiday.     (h) “**Parent Entity**” of a Person means an entity that, directly or indirectly, controls theapplicable Person and whose common stock or equivalent equity security is quoted or listed on anEligible Market, or, if there is more than one such Person or Parent Entity, the Person or ParentEntity with the largest public market capitalization as of the date of consummation of theFundamental Transaction.     (i) “**Person**” means an individual, a limited liability company, a partnership, a joint venture,a corporation, a trust, an unincorporated organization, any other entity or a government or anydepartment or agency thereof.     (j) “**Principal Market**” means the OTC Bulletin Board.     (k) “**Successor Entity**” means the Person (or, if so elected by the Holder, the Parent Entity)formed by, resulting from or surviving any Fundamental Transaction or the Person (or, if
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so elected by the Holder, the Parent Entity) with which such Fundamental Transaction shallhave been entered into.     (l) “**Trading Day**” means any day on which the Common Stock is traded on the Principal Market,or, if the Principal Market is not the principal trading market for the Common Stock, then on theprincipal securities exchange or securities market on which the Common Stock is then traded,provided that “Trading Day” shall not include any day on which the Common Stock is scheduled totrade on such exchange or market for less than 4.5 hours or any day that the Common Stock issuspended from trading during the final hour of trading on such exchange or market (or if suchexchange or market does not designate in advance the closing time of trading on such exchange ormarket, then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwisedesignated as a Trading Day in writing by the Holder and the Company.     (m) “**Voting Stock**” of a Person means capital stock of such Person of the class or classespursuant to which the holders thereof have the general voting power to elect, or the general powerto appoint, at least a majority of the board of directors, managers or trustees of such Person(irrespective of whether or not at the time capital stock of any other class or classes shall haveor might have voting power by reason of the happening of any contingency).[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,